People focus too much on the "profit" miners make, and not the
verifiability and anarchism they are supposed to be providing to the
bitcoin network. In that regard, arguably the most important, bitcoin
has already failed entirely.
This was by design.
Reg. CPU coin: it gives intense advantages to botnet owners and doesn't require people to be heavily vested into Bitcoin. It would also allow web companies to fix their server's low CPU occupancy. I'm not sure you'd achieve anything you'd like to achieve.
The CPU algorithm itself is most troublesome. Remember it must also have no parallel equivalent, and stand the torn of time turning present day CPUs into next day GPU cores. (See also: Bulldozer)